How To Save Money: 10 Useful Tips

Saving money is a skill that nearly everyone needs to learn. You don't have to be rich or even well-off to benefit from the strategy of saving money: it's useful for people at all levels of income. But some people may be more inclined toward spending, and that can make it difficult for them to get into the habit of putting their hard-earned money away for later use. If you're wondering how best to save your cash so that it grows over time, here are 10 ways you can get started: 

1. Create a budget: When you're trying to figure out how to save money, the first step is to create a budget. A budget is simply an estimate of your income and expenditures for a given period of time. You write down all of your income sources and subtract any fixed monthly costs or expenses that are not affected by your spending habits. This leaves you with what's left over as discretionary spending—the money that you can put toward savings, or other financial goals. 

2. Track your expenses: Knowing where your money is going is an important step to saving it. Tracking your expenses on a regular basis can help you make better financial decisions. You can create a spreadsheet and write down every purchase or withdrawal from your bank account, including ATM withdrawals and cash deposits.  

3. Set up automatic savings transfers: If you have a salary account that pays interest and can afford the monthly payments, set up an automatic transfer from your salary account to another savings account. You should do it on the first day you receive the payment.  

4. Save money while you shop: We spend most of our money on shopping for clothes, groceries, electronics etc. These expenses are important but shop around for the best deals. While shopping, keep your eye out for sales and coupons. If you can afford to buy things when they're on sale, it will definitely save you money in the long run. 

5. Get a second job: If you're able, it may be worthwhile to work another job in addition to your full-time job. This can help you pay off debt faster, improve your credit score and build up savings for things like a down payment on a house or car.  

6. Learn the difference between needs and wants: The first step of effectively saving money is learning the difference between needs and wants. Needs are things that you need to survive, whereas wants are things that are nice to have. You can survive without your favourite coffee from Starbucks every now and then. We won’t ask you to stay away from the things you love, but try to frame a boundary.  

7. Get medical insurance: Believe it or not, a medical bill can suck up your bank balance. Your financial condition can be changed overnight if you get stuck in a medical emergency. But, having medical insurance can save you and your hard-earned money in every way possible. However, pay for insurance that has a higher claim settlement ratio and good network hospital coverage.  

8. Invest: While you’re planning to save money, you should also plan to multiply that money and this can be done by the art of investing. You can buy mutual funds, stocks, gold or anything that pays a better profit over time. However, before investing, you should have complete knowledge because having no proper information can lead to big losses.  

9. Invest in Tax savings schemes: There are a lot of government-introduced tax savings schemes that allow you to save taxes. An individual can save up to 1.5 lakh by investing in schemes that fall under the 80C IT Act.  

10. Create a pension fund: Why do you want to save? For your secure future, right? Then the best way to do it is by creating a separate pension fund. These funds are usually long-term savings instruments that provide you with a regular income after retirement upon maturity.  

Now that you have a better understanding of how to save money, you can start putting these tips into action. Remember, everyone's situation is different, and there is no one right way to save money. Instead, focus on doing what works best for you and your family. 

Disclaimer: This article does not intend to pass on any financial advice. Please invest at your own discretion.